Written by Derek San Filippo
Derek is a former staff writer and has written 100+ articles on property & casualty, health and life insurance topics as.
Edited by Dan Marticio
Dan Marticio is the content manager at SmartFinancial and has written 150+ articles across multiple insurance verticals.
Updated May 4, 2023Expert Reviewed
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You can cancel your health insurance at any time if you have an ACA marketplace plan. Meanwhile, other plans like group health insurance through your employer or Medicare Advantage plans would need to be canceled during specific enrollment periods or if you experience a qualifying life event.
Keep in mind that canceling your health plan early may create a gap in healthcare coverage and you may even face a tax penalty depending on your state. Ideally, you should find a new policy before canceling your current policy to ensure you have coverage year-round.
Key Takeaways
The cancellation terms on a health insurance plan can vary based on whether you have an ACA marketplace plan, a plan through your employer or a private insurance plan.
Plans purchased through your state’s ACA marketplace can be canceled at any time but you may need to provide notice. [1] For example, if you purchase a health plan through Covered California, you must provide at least a 14-day notice before your plan is canceled — same-day cancellations may be unavailable. [2]
If you’re insured through your employer, you may need to meet certain conditions before you can cancel your policy early. For example, an employee may only cancel their policy if the company is not deducting premium contributions pre-tax. [3] It may also be possible to cancel the health plan mid-policy if you experience a qualifying event, such as having a child or finding a new job.
If you’re canceling a private insurance plan, you will need to contact your insurer directly to see if you can cancel your policy early and if penalties apply. Private plans are sold outside the ACA marketplace and these insurers may enforce requirements outside ACA guidelines. You can find your provider’s number on your health insurance card, your policy and your bills. Your insurance agent will let you know if there is an early cancellation fee and what steps are necessary before canceling.
While the cancellation process can vary based on the type of plan you have, switching or canceling any type of plan is usually possible during a special enrollment period.
For many types of health insurance plans, you will need to enroll, switch or drop a plan during open enrollment. However, these actions are possible outside this time window if you experience a qualifying life event that triggers a special enrollment period. Such events commonly include:
The free look period, or sometimes known as a cooling off period, is a time window when policyholders can cancel a recently purchased health plan and receive a full refund. The duration of the free look period can vary from 15 to 30 days depending on the insurer. [4] It is only applicable to new health insurance policies, not renewals.
Below is a look at several health insurance plans and their free look periods.
Company
Free Look Period
If you cancel your subscription before it renews and if you have remaining funds in your United Healthcare account.
